U.S. real estate listing website Zillow has arrived north of the border. Zillow broke the news with the announcement of its partnership with a well-known real estate brand in Canada that will directly feed listings to the site.

This has long been a source of concern throughout the real estate industry for a few reasons. But first, a little background.

How did Zillow come to be? Its widespread appeal in the U.S. began with a fragmented MLS system. The idea was to streamline every property listing into one easy-to-access platform. Today, Zillow’s living database merges more than 110 million listings from over 625 MLS feeds in the U.S. By adding Canadian listings into the mix, Zillow will widen the pool of potential homebuyers – and leads for agents.

However, unlike our neighbours to the south, Canada already has a unified MLS system in Realtor.ca, which displays almost every residential listing.

Part of the perceived problem is that Zillow’s listings include sold-price details, among other personal data that the Toronto Real Estate Board maintains must be kept private. The matter is currently before the Supreme Court, in the board’s attempt to secure its position. (Update, July 19, 2018: Zillow’s Alexa Fiander wrote to REM to say: “This is incorrect. Zillow will not show Canadian sold listings, and we will comply with local rules and regulations that affect the display of property details in Canada.”)

Beyond the data dilemma, part of Zillow’s modus operandi involves taking listing feeds from real estate companies and selling leads back to Realtors. That is the real underlying reason behind the industry’s apprehension. (Update, continued: Fiander says: “Listing agents are not charged for leads on their own listings.”)

With publicized sold data and Zillow’s high-tech toolkit, is it possible that it will disrupt the real estate industry as we know it? Might agents actually abandon their brokerages and their brands? Could this be the start of the For Sale By Owner (FSBO) era? It’s unlikely.

The truth is, 12 years since the birth of Zillow, FSBO transactions in the U.S. are at an all-time low. In Canada, DIY home sales became more common – and feasible – in 2017, at the peak of the real estate roller coaster when bidding wars erupted before the For Sale sign was up on the lawn. But what goes up eventually comes down again – and in this more challenging market, real estate agents will continue to provide essential expertise and value to consumers.

Canadian agents don’t need Zillow to promote their listings to foreign buyers. Anyone south of the border and beyond who is searching for Canadian properties will find them on Realtor.ca and remax.ca.

Ultimately, Zillow has not changed the basics of the business. It still takes market knowledge, smart strategies and good old-fashioned hustle to convert leads.

In spite of the success of Canada’s existing property listing platforms, there’s always room for improvement. Real estate is a highly competitive industry by nature. Agents will need to step up their game to stay ahead. In my opinion, the good ones are already doing that every day.

14 COMMENTS

Zillow works because there is no national MLS® in the US. Zillow also works because agents can buy positions so that all the listings in the area will feature the smiling face of the agent who bought that zip code. REALTOR.CA does not sell space or positioning. Its about the properties not the agents. Zillow allows advertisers to offer discounts on the properties promoted. Click here to save $5,000 is a marketing feature not allowed in Canada.

It’s clear to me that most Realtors in Canada and the “Big Brands such as Re/max and Royal Lepage” understand why we don’t need Zillow or others like them who simply want to sell us leads from our own listings.

Zillow is a hitch-hiker of sorts getting a lift from—and thus exploiting—the weakness of the low energy, low knowledge, low intelligence (but high income expecting) Realtor. The “low factor” is why so many try and fail at the trough…and Zillow knows this. Thus Zillow appeals to the majority of Realtors-in-the-saddle on any given day. It’s simply a numbers game, and the gamblers most always lose to the house. The only thing gamblers don’t lose is the wishful expectation that the next roll of the dice is the big one. It’s called addiction, and Zillow is simply the newest drug of choice for the gamblers.

It is time for the real estate sales game to be changed from a rambling, gambling-casino-without-walls into a real profession whereby the professionals have no need for bells and whistles going off every time someone wins twenty bucks…or a lucky sale…just before exiting the game.

It is amazing how often so many fall for the most prevalent motivating word ever employed to influence us to buy stuff…FREE. We may be sure that whenever FREE is thrown in our faces there is bound to be some form of misrepresentation involved.

Zillow has their eyes on the wallets of every Canadian Realtor. Their claim to provide free advertising of our listings (which of course already exists on Realtor.ca) is simply a baiting tactic to convince Canadian Realtors to give them the data that they need in order to run their core business which is selling leads for our listings to their client agents. Even a child could see how ridiculous that idea is but the possibility of getting leads and potential sales is too powerful for many to see past. In the GTA alone we have over 50,000 agents trying to make a living selling real estate. Many are doing well but far more of them are not and they are continually scouring for their next lead and sale. Zillow sounds like their saviour, their “magic pill” to bring in leads and sales. If you’ve never had leads from realtor.ca it’s because you don’t have listings, that is a simple fact. Hopefully you or your brokerage runs a website which uses the DDF feed from realtor.ca to access and advertise the listings of other brokerages. This collaborative option exists for you today! I don’t truly like it but that option was put in place some time ago to ward off the portals like Zillow from coming here and doing this themselves. If your business model is to only work with buyers you are the type who will salivate at the idea of getting leads from other people’s listings. This in my opinion is where things have gone off the tracks. We have truly become a self entitled group. “I want to advertise a product that I don’t actually have in order to generate clients for myself” Unfortunately that horse is long out of the barn. If we want to look at this business as a business then we must look long term. Those of us who have the listings will eventually resent the exploitation of our hard worked-for listings and we will begin to find ways to keep our listings (and our leads) to ourselves. That is the exact opposite of where our beautifully collaborative system should go. Zillow does not bring with it prosperity for the agents, what it brings is the next steps of erosion of our MLS from the inside out.